Well, I figured it was still bad even though hiring is picking up a little bit, but I didn’t know it was this bad:
More people have jobs in America this month than they did last month, so says the U.S. Bureau of Labor Statistics (BLS).
But the headline unemployment rate of 8.3% isn’t the whole story.
It’s not that there wasn’t positive news. The addition of 243,000 new jobs far exceeded economists’ expectations for an increase of 150,000. It was the seventh straight month of increases of 100,000 or more.
And yet buried in the BLS report are numbers that paint a different picture.
One of the main reasons the rate dropped, in fact, is because the BLS stopped counting nearly 1.2 million people as part of the labor force.
That’s a record. It puts the labor force participation rate at a 30-year low of 63.7%, significantly below the long-term average of 65.8%.
While it’s true the official number of unemployed fell from 13.1 million in December to 12.8 million, it helps when you simply don’t include 1.2 million in the equation.
“This is not a fundamentally positive way to see the unemployment rate fall,” Jason Schenker, president of Prestige Economics, said in an email to clients.